United States / 06 September 2012 / United States, U.S. Court of Appeals, Second Circuit / Agility Public Warehousing CO. K.S.C., Professional Contract Administrators, Inc. v. Supreme Foodservice GMBH / 11–5201–CV
Country | United States |
Court | United States, U.S. Court of Appeals, Second Circuit |
Date | 06 September 2012 |
Parties | Agility Public Warehousing CO. K.S.C., Professional Contract Administrators, Inc. v. Supreme Foodservice GMBH |
Case number | 11–5201–CV |
Applicable NYC Provisions | V | V(1)(b) | V(1)(e) | V(2)(b) |
Source |
online: PACER |
Languages | English |
Summary | The Respondent, Supreme Foodservice GmbH (“Supreme”), appealed the confirmation of an arbitral award in favor of the Petitioners, Agility Public Warehousing Co. K.S.C. et al. (“Agility”). On appeal, Supreme argued that the award contravened Article V(2)(b) NYC by violating the New York public policy of requiring dismissal of suits in which a plaintiff refused to testify about matters pertaining to the affirmative relief it sought. Supreme also argued that the arbitrators’ decision to draw adverse inferences from the refusal of Agility’s witnesses’ to testify, rather than to dismiss Agility’s claims, violated Article V(1)(b) NYC, as well as Section 10(a)(3) and 10(a)(4) of the Federal Arbitration Act (“FAA”), and was in manifest disregard of the law. The United States Court of Appeals for the Second Circuit Court affirmed confirmation of the arbitral award, holding that Supreme had not demonstrated that confirmation of the award would violate the United States’ most basic notions of morality and justice. The Court held that the public policy defense to recognition and enforcement of an arbitral award under Article V(2)(b) NYC referred to national public policy, rather than that of any particular state. The Court found that it did not need to rule on whether a refusal to testify by the plaintiff was against national public policy. It held that Supreme’s current complaints were “of its own making” because it had refused to postpone the proceedings until the witnesses were available and had expressly invited the arbitrators to draw an adverse inference as an alternative to dismissal. The Court rejected Supreme’s argument that the arbitrators’ decisions violated Article V(1)(b) NYC, holding that the decisions did not amount to due process violations under U.S. law. Finally, the Court determined that the FAA’s vacatur provisions in Chapter One, applicable to domestic arbitrations, were applicable in the present case pursuant to Article V(1)(e) NYC, but dismissed all such grounds as inapplicable. The Court rejected Supreme’s contentions that by drawing an adverse inference, rather than dismissing the claims, the arbitrators violated principles of fundamental fairness (Section 10(a)(3) of the FAA), exceeded the scope of their jurisdiction (Section 10(a)(4) of the FAA), or knowingly disregarded applicable law (manifest disregard of the law). |
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Attachment (1)
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